Sunday, October 7, 2012
I am proud of the accomplishments I’ve made in my 5 years since leaving college. As I mentioned in my previous post, I got my Professional Engineers License this year, which was the soonest I was eligible to test for it. I continue to learn in the field of engineering every day. I have my first passive income business profitable with the rentals, and a lot of learned lessons and experience along the way…with the rentals earning a net passive $1,000 a month, I am turning to my next venture of internet marketing. I do plan to expand my real estate portfolio, but things get tricky with the loans when you obtain 4 or 5 properties. I’ll write about that later. For now I want to focus on getting my internet marketing business up and running. I am excited to see where this venture goes and hopefully create another passive income stream of $1,000 a month in the next year. I would love to scale it far past that eventually, but for now, baby steps. An overall long term goal is to pay down on my real estate with extra passive income, and my personal income. As I mentioned in a previous blog post, I will be mortgage free within the next few years. I love the thought of getting this financial snowball big enough to pick up some big chunks of snow!
After closing on my fifth rental in February, I needed to get it renovated and rented fast! I am a civil engineer by day, and I had my PE (Professional Engineering Licensure Exam) coming up in April. I was cutting it thin by buying this one, but I couldn’t pass up the deal.
My fifth and most recent rental was bought in February 2012. This rental is one half side of a duplex. With 3 berooms, 2 bathroom, and a one car garage, I stole this property at $55,000! The initial appraisal before I renovated it was $76,000.
The smartest move I ever made in renovating was to hire a painter for this property! There were several minor fixes needed, but the major tasks were prepping and painting the walls, trim, ceilings, and doors, as well as putting all new floors and some new trim in both units.
I purchased my third rental in April 2011, as well as my fourth – it was a duplex! I have to say today that this is the best property in my portfolio. I purchased the entire building for $61,100! After looking through it with my realtor, I knew I wanted it because all it needed was new floors and paint and a few miscellaneous fixes. I was so excited when I was the highest bid on it!
My second rental was a town home, not far from my house. I caught a great deal on this 3 bedroom, 1.5 bath town home at only $46,000. The previous owner had bought if for $71,400. This rental needed all new paint, all new floors, and quite a bit of trim replaced.
The majority of foreclosures that are sold are in pretty bad shape. Typically, when people know they are going to lose their house, they cease to maintain it, and the foreclosure can be a process of several months to a couple years. Fortunately, my first rental house was in pretty decent shape, which made it an attractive buy for the price. There were a couple major renovations I needed to make to the house before renting it for the first time. The first, was installing central heat and air. I got a new system installed for $4,500, which is far cheaper than most companies quote. The house had baseboard heaters when I bought it, and one window unit air conditioner in the living room. The opposite end of the house would be terribly hot since there was one source of cold air, and adding window unit air conditioners was not an option since the windows were the type that slide left to right. The second major renovation, was replacing the kitchen cabinets and counter tops, and installing a back-splash.